USPS looks to union to help curb costs and avoid contracting

The U.S. Postal Service is asking for the cooperation of its unions in holding down costs if it is to avoid contracting out work, Postmaster General John Potter said last week.

Potter said he needed union help to improve service, reduce costs and increase revenue, suggesting lack of help on those issues would necessitate more outsourcing, though he echoed past pledges not to outsource existing postal jobs.

While postal unions and some congressional Democrats remain opposed to almost any outsourcing, Potter said postal managers, when asked to cut costs, need the discretion to outsource functions.

The hearing was the second held by the subcommittee since the passage of the 2006 Postal Accountability and Enhancement Act, which introduced the most far-reaching changes at the agency since it became semiprivate in 1970.

The bill left undetermined many aspects of the Postal Service’s businesses, including to what extent the agency will use contractors to cut costs. A task force of postal and union officials is working together to issue recommendations this year.

Postal officials used the hearing to emphasize the difficulty of USPS’ position. The service faces a decline in first-class mail volume and an increase in addresses — it is delivering less mail to more people.

Meanwhile the reforms prevent the Postal Service from controlling its prices or costs, 80 percent of which are labor-related. The law caps postal prices. And binding arbitration means USPS lacks the final say over pay and benefits.

Potter described his approach as a compromise, neither continuing old practices nor outsourcing everything possible. He repeated vows the USPS will not contract out existing jobs, and cited a July 12 agreement with the National Association of Letter Carriers, in which the Postal Service agreed not to outsource delivery routes in major cities.